In his state of the nation address in July, President Cyril Ramaphosa said the government would expand and institutionalise public employment programmes “so that more and more young people can participate in job opportunities and skills development. We aim to expand the public works programme exponentially to create more job opportunities”.
But the National Treasury’s fanatical obsession with permanent austerity, despite the collateral damage to the economy, has resulted in cuts of R13.7bn to public employment programmes that will decimate work and livelihood opportunities in a country that has one of the world’s highest unemployment rates. During the third quarter of this year SA, with 12.2-million people without work, had an unemployment rate of 41.9%, according to Stats SA’s latest quarterly labour force survey.
SA has three public employment programmes that had a budget of R16.8bn during 2023/24 and created about 1.8-million work opportunities. These are the Presidential Employment Stimulus (PES), Expanded Public Works Programme (EPWP) and Community Works Programme (CWP).
The 2024 budget allocated R7.4bn to the PES — R2bn lower than the previous year — and no further funding for the remaining two years of the medium-term expenditure framework (MTEF) period. The successful programme has created 1.7-million work and livelihood opportunities since inception in 2020.
The Treasury said allocation would be financed through a combination of the Unemployment Insurance Fund (UIF) surplus and reprioritisation — code for deep cuts to the EPWP and the CWP, a recipe for creating conflict between the programmes. The UIF was expected to fund the successful R4bn basic education employment initiative (BEEI), which placed about 250,000 teacher assistants in schools.
But the UIF has not provided the funding and the BEEI has not employed teacher assistants this year. The PES budget has shrunk to about R3bn from R9.4bn during the previous year and the number of work and livelihood opportunities it creates have plunged by more than half.
The EPWP’s budget was cut by R3.1bn (30.9%) to R7bn from R10.1bn during the 2024 MTEF period. The programme will not be able to achieve its target of creating 5-million work opportunities in five years. In parliament, public works minister Dean Macpherson said the cuts would hurt the programme and its deliverables. It would be unfair to expect the department to do more with less, he said.
The CWP’s budget was cut by R4.3bn (30.3%) to R9.8bn from R14.1bn. As a result, I estimate there has been a 50% decline in work and livelihood opportunities provided by the three programmes to about 900,000 during 2024/25.
After the fact of the brutal budget cuts, the 2024 medium-term budget policy statement announced a review of active labour market policies. “The fragmentation makes it difficult to access and navigate, and there is no single point of entry for citizens to assess their needs.”
But this is a bad-faith review to justify cuts that have already happened. It shows that the Treasury is not interested in improving the effectiveness and scale of public employment programmes. Its only objective is to achieve primary budget surpluses, whatever the cost to the economy.
SA must merge its public employment programmes and create a new quasi-public institution that has civil society oversight and professional management and a target to create millions of jobs. It must improve the quality of work and provide a living wage to participants.
Expecting primary budget surpluses of R326bn during the 2025 MTEF period to make a difference within the context of a gross borrowing requirement of R1.7-trillion that adds to existing debt of R5.6-trillion is the equivalent of chasing your own tail. The only explanation for this madness is that the ANC is so committed to a primary budget surplus it is prepared to become a 25% party.
The way things are going Jacob Zuma may return in 2029 at the age of 87 as the godfather of a new coalition government.
• Gqubule is research associate at the Social Policy Initiative. He writes in his personal capacity.
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